I never came across someone blocking a technique out of pain. Pain gets worse if you block, so I suppose an uke in pain would loosen his grip instinctively. If it's a newbie, no one would apply whatever painful technique in a way the newbie could damage himself by blocking the technique. (resisting sankyo or such...). At least no one I know...
I have known people to block techniques out of pain, or the apprehension of pain. However, they are only able to block techniques that are applied poorly (as you said, if the technique is done well, then the pain just gets worse), or the person doing the technique deliberately eases off to avoid injuring uke. This can be a big problem with inexperienced ukes as they want you to prove that the technique is effective, but at the same time, you don't want to put them in hospital.